Optimization of Fasteners with the TCO Model According to Bossard
C-parts make up 65-75% of the purchasing volume for most industrial companies – thus offering significant opportunities for cost reduction. RAWAG, a Polish public transport equipment manufacturer, has implemented this strategy with our support.
The Customer: Constantly Striving for Improvement
RAWAG, which has been part of the Bode Group since 2014, is a leading manufacturer of railcar equipment in Poland and Europe. The company’s products, such as doors and shelves, can be found in trains, buses and trams. More than 100 tonnes of aluminium sheets and profiles and as many as half a million fasteners are used in production every month.
The company, which has been in existence for half a century, is growing at a very dynamic pace, consistently applying the principles of lean management. The constant search for new areas of optimization has also extended to fasteners, which is why RAWAG engaged Bossard Poland to collaborate. The starting point was the TCO (total cost of ownership) model for C-parts, which is the basis for our 15/85 rule, also known as the iceberg model.
What Is the 15/85 Rule?
The TCO model we use for fasteners is based on a tool developed by the Institute of Technology Management at the University of St Gallen. It shows that the total cost of managing C-parts looks like a symbolic iceberg:
Only 15% is the actual unit price of the product in question, the rest, or 85%, is the entire ecosystem – including, but not limited to design and development, procurement, quality control, inventory maintenance, assembly, logistics, and more. The range of processes involved in handling this assortment group shows great potential for optimization, often not yet discovered in industrial companies.
Watch how RAWAG optimized their fasteners utilizing the total cost of ownership concept.
Analyzing and Optimizing Products, Assortment, and Assembly
At the start of our collaboration with Rawag, we analyzed their products, assembly lines and assortment of more than 2,000 fasteners in detail, identifying as many as 700 possibilities for optimizing fasteners. Implementing those changes will have a significant impact not only on their assortment (a reduction by as much as 15%), but also on the quality, flexibility and overall costs of the assembly processes.
Focus on Lean Management
Rawag places particular importance on managing their factory in accordance with lean philosophy. SMED, Kaizen or 5S are just some of the lean tools that their workforce of 600 people uses daily. Lean Management Manager Albert Łoza gained his experience working in Japan for seven years at the world’s largest automotive company, the cradle of lean philosophy. Every area of the production process is important, he says, and is worth looking at – even such seemingly minor components such as screws or nuts.
Rawag is an example of a company that has grown tremendously in a fairly short period of time through actions in line with the lean philosophy.
Smart Logistics for C-Parts
When focusing on eliminating waste in the production process, the topic of fastener management cannot be overlooked. For this reason, we are about to implement the Bossard SmartBin system, which will improve parts availability and optimize the ordering process for Rawag. This will then function automatically. SmartBin will also allow better management of C-parts in terms of stock control, changes in demand, and obsolete items.
The Bossard SmartBin system is based on the traditional kanban method, but fully automated. It is part of our comprehensive logistics solution Smart Factory Logistics. This eco system consists of containers equipped with weight sensors that are connected wirelessly to our supply chain platform ARIMS, which completes and processes the data coming in from production.
SmartBin: How It Works
The principle is simple. The weight sensors in the SmartBin containers identify a predefined critical stock level, immediately sending the demand to the system. The system completes the demands, combines them into orders and passes them on to the supplier. This is usually Bossard, but it's not a prerequisite, as we also offer a supplier consolidation service, which means that other C-parts in the factory can also be managed by our SmartBin system.
Why Is It Worth Automating?
The advantages of using such a solution are manifold. First and foremost, it saves time for the purchasing department, as the ordering of missing materials takes place virtually unattended. With a properly configured system, processes become much more transparent and production predictability much higher. Downtime, which always has its consequences, can thus be avoided.
The automation of the fastener ordering process also saves space in the warehouse. This is because there is no longer a need to stockpile excessively large quantities, as the parts required are ordered and delivered on the fly. Their distribution in special racks close to the assembly line/station translates into better availability and savings in crew time.
Thanks to the ARIMS mobile application, production managers have real-time access to stock levels, order lists, delivery times, etc. from any location inside or outside the factory. On the basis of the data obtained from the system, it is also possible to plan future production more effectively.
Anticipated Benefits of Bossard Solutions at RAWAG
